Why Facebook’s Big Step Back Helps (Some of) Us Auction Marketers
Almost all of my favorite movies fall into the heist genre. I met my Hollywood crush, Jessica Biel, in The Illusionist. I have been driving a MINI Cooper since soon after I got The Italian Job on DVD. The strategy and choreography of fictional thieves intrigue me, and I love the slight of hand stuff. The end-of-movie reveals make me feel unobservant, even as they wow me.
The Trump presidency has offered a similar unveiling, particularly when it comes to Facebook. I’ll explain that in a minute.
First, let’s time travel back five years—two years before Donald Trump declared his candidacy for President. Facebook gave access to Global Science Research (GSR) to do some academic research amongst its users. 300,000 Facebook users opted in to take part in a study. Exploiting an application programming interface (API), GSR grabbed data from somewhere between 50 and 87 million Facebook users who were connected to those 300,000 volunteers. GSR then—against Facebook data policy—sold this data to Cambridge Analytica, which used it to create psychographic profile groups it would later shop to multiple political candidates.
Facebook discovered this data breach in 2015, shut down the API in question, and demanded both parties delete the data they had harvested. A year later, having not complied, Cambridge Analytica used its data as part of its digital marketing for the Trump campaign. Once officially gaining the nomination, Trump abandoned their data, having access to the Republican National Committee’s database. (Hillary Clinton refused Cambridge Analytica’s services from the start, instead using the mirrored resource of the Democratic National Committee’s storehouse of data.)
A few months later, candidate Trump became President-elect Trump. As many have sought to explain his uncanny rise to power, intense blame and scrutiny have been levied on all sorts of possible culprits. Much of that blame has fallen on Facebook—whether for Russia’s incredibly efficient interference or for Cambridge Analytica’s data deal.
Over the past month, tens of thousands of Facebook users—including Elon Musk and Will Ferrell, Pep Boys and Playboy—have left the platform in protest. Pundits and journalists have been whipping consumers into a frenzy, telling them their data isn’t safe or private, that the proprietary algorithms that run Facebook need to be shared with the world. Few of the stories I’ve heard or read have made much of the fact that this data breach is half a decade old and that it wouldn’t be possible to duplicate today and hasn’t been since April 30, 2015.
In response, Facebook brass has recently invited regulation and offered some seemingly-draconian proactive changes to their platform. One of the biggest measures Mark Zuckerberg offered was the phasing out of Partner Categories. If you’re not familiar with this data set, it’s information from third-party sources like Acxiom, Experian, and Oracle Data Cloud. Facebook has been taking up to 15% of advertiser spending to buy matching data from these sources. That data includes all the stuff in your credit report and other public information. That’s how Facebook knows users’ income, net worth, cash accounts, home values, purchase history, and likely-to-move status (among hundreds of other data point). When matched with its user accounts and/or advertisers’ uploaded lists, this data helps create highly targeted lookalike audiences. These free lookalike audiences have allowed small businesses to compete with Fortune 100 companies in the marketplace.
While removing these data sources seems like consumer protection, the opposite might actually be true. That’s where the slight of hand comes in. See, that data is still available. Right now, I can buy a lot of this third party data from my mailing list broker for $100. I can buy even more robust data from Experian and Axciom, too. Then, I can upload that data to Facebook to create custom audiences to use as filters for my other lists.
With this new move, Facebook now doesn’t have to charge advertisers for these third-party data sources, and they can show regulators that their advertisers are using only audiences based on user-revealed interests and the advertisers’ proprietary lists. That third party data will still get leveraged in the advertising system, and now it won’t raise any red flags.
As a consumer, I don’t care either way. Personally, I prefer my ads tied as closely to my interests and realities as possible; and I know this data is pooled as anonymous aggregates that no advertiser or hacker can see. As an advertiser, I’m a little bummed that I’ll now have to buy that data separately and at prices not negotiated by one of the biggest companies on the planet.
Because Facebook currently allows your lookalike audiences to remain in tact even after your original audience criteria has been removed, those of us who’ve been leveraging this third-party data for years should have an advertising advantage until Facebook closes that loophole—should they eventually close it. Either way, I don’t mind suddenly getting a new advantage in Facebook advertising.
Mark Zuckerberg took days to respond to the uproar online and on TV news networks so that he could follow the advice of J Daniel Atlas, the protagonist of Now You See Me, a flick that featured illusionists plying their craft to perform Robin Hood-type heists: “First rule of magic: always be the smartest person in the room.” Zuckerberg offered an olive branch to the media, the government, and Facebook users. Along with that he secured Facebook’s place as the most advanced, intuitive advertising platform for the foreseeable future.
Even Terry Benedict’s casinos aren’t sophisticated enough to have seen this brilliant move coming. But now your company is. You’re welcome.
Stock photos purchased from iStockPhoto.com